For marketers wondering how conversion rates change depending on where ads appear on Web pages, Google Chief Economist Hal Varian appears to have an answer.
Varian calls the problem “tricky,” because Google ranks ads by bid times and ad quality, so ads in higher positions tend to have higher quality. These higher-quality ads tend to have higher conversion rates. He writes in a post on the AdWords blog that this means marketers may see a correlation between auction position and conversion rates.
Another fact that influences conversions: marketers increasing bids might see their average position move lower on the page. That’s because when bids increase, ads appear in new auctions, and tend to work their way up from the bottom. This can push down the campaign’s overall position, he writes.
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